USA threatens new Turkey sanctions unless jailed pastor released

Gladys Abbott
August 17, 2018

The US imposed sanctions on two Turkish government ministers and doubled tariffs on Turkish steel and aluminium imports over the continued detention of an American pastor on espionage and terror-related charges.

The engagement by Turkish President Recep Tayyip Erdogan, who has harshly criticized Germany and other European nations in the past, is part of a diplomatic campaign to capitalize on worldwide unease over U.S. President Donald Trump and American tariff disputes around the world.

The pastor row is one of several between the North Atlantic Treaty Organisation allies, including diverging interests in Syria and USA objections to Ankara's ambition to buy Russian defence systems, that have contributed to instability in Turkish financial markets.

President Recep Tayyip Erdogan has accused the United States of waging a targeted economic war on his country, and on Tuesday he proposed a boycott of USA electronic goods.

The Turkish currency began to recover after authorities this week took steps to help bank liquidity and limit swap transactions.

The Turkish currency has lost about 40 percent of its value this year against the US dollar.

The lira had plunged to record lows on Monday, but has since clawed back some of its losses, not only after the retaliation on tariffs, but also after the Turkish Central Bank announced banks would be given help to keep money moving around the system.

The Turkish lira was up 4% against the United States dollar following the conference call and after reassuring words from the French president, Emmanuel Macron, and Germany's chancellor, Angela Merkel, that Turkey's stability was important.

Cevdet Erdol, president of the Health Sciences University in Istanbul, urged Turks to boycott US tobacco products and "to stop smoking altogether", according to Turkey's state-run Anadolu news agency.

Meanwhile, the Turkish people also expanded their boycott of other United States products ranging from textiles to fast food.

The White House called the Turkish counter-tariffs a step in the wrong direction and signaled a hard line.

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Last week, Washington doubled steel and aluminium tariffs on Turkey over its continued detention of USA pastor Andrew Brunson. On Tuesday, he said Turkey would boycott United States electronic products.

During the attempted Turkish coup in 2016, Qatar quickly offered support to its government.

Before he spoke, the lira strengthened more than 3 percent, despite signs that the dispute with the United States is as wide as ever.

There was also optimism about better relations with the European Union after a Turkish court released two Greek soldiers pending trial.

Analysts say Turkey is also likely to seek a more dynamic economic relationship with China and Russian Federation, with whom ties have warmed considerably in recent years.

"The tariffs that are in place on steel will not be removed with the release of pastor Brunson".

Turkish Airlines and Turk Telekom have said they will halt advertising in USA media.

"Rates have gone up by 10 per cent".

Measures to restrict the amount of currency that can be exchanged with foreign banks were also said to be boosting the currency.

The Turkish currency was trading at 5.85 at 1740 GMT, more than 1 percent stronger on the day.

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